Fmr Verisk CEO Scott Stephenson

Auren Hoffman (00:01.002) Hello, fellow data nerds. My guest today is Scott Stephenson. Scott served as chairman, president, CEO of Verisk Analytics from 2013 to 2022. Verisk trades under VRSK on NASDAQ as a market cap of over $40 billion. Since leaving Verisk, Scott served as chairman of Aveda and most recently became chairman of One Incorporated, a digital payment solution for the insurance industry. Scott, welcome to World of DaaS.

Scott (00:29.154) Thank you, Auren. Good to be with you again.

Auren Hoffman (00:31.786) Yeah, good to we, so you are the second, second timer on world of DAS. So this is a huge honor. Yeah. Now we first talked when you were CEO of Verisk. Now, how do you think Verisk has done since you've departed?

Scott (00:35.854) I guess so.

Scott (00:48.173) Well, I had a few hopes for the company when I was stepping out in 2022. Really, there were four things that I was hoping would happen. you know, they were the things I was talking about actually around the time of my departure. Those were number one, I was hoping that we would we would sell the energy business. The second one was that in light of having sort of changed the contours of the business.

because there were other non PNC businesses that had been sold even before that, that in light of a sort of, pardon me, property and casualty, right? the kind of the majority of what the company was, in light of that, the second thing I was hoping for was that the costs would be refactored to reflect a more focused kind of a business.

Auren Hoffman (01:21.514) PNC is property and casualty for PNC is property and casualty for our, for our listeners. Yeah.

Auren Hoffman (01:44.431) And cost-preventing factor meaning like reduction in workforce and stuff. Yep.

Scott (01:47.966) Mm-hmm. Yeah, in line with and mostly center costs and mostly in line with the fact that the shape of the company was changing a little bit.

Auren Hoffman (01:56.542) So center meaning like at the headquarters operations, those types of things, GNA. Yep.

Scott (02:01.388) Yeah, shared technology and things like that. The third thing I was hoping for was there was a project called the re-imagine project that was actually initiated in 2018, 2019, but it was basically about trying to completely rethink the most legacy part of the whole company and just to come up with fundamentally different ways of serving customers and adding value. And the fourth, which is kind of a little bit more tactical, but by the time I left in 2022, the company had been...

out in the public markets for 10 years. And so I felt that there were some matured processes that ought to be in place. One of which was to provide guidance to the markets. We were now a well-seasoned kind of a stock. I'm...

Auren Hoffman (02:49.61) Sir, what you mean by providing guidance? Like it wasn't providing general guidance? that wasn't happening? interesting. Okay, got it. Okay. Why wasn't it happening before? I thought like most companies do that.

Scott (02:53.051) annual guidance of, you know, where it didn't, does now, does now. Yeah, so

Scott (03:03.722) Well, usually when companies begin to go public, take the opportunity, at least for a while, to talk to the street in the ways they would like to. And it frequently doesn't involve guidance kind of right out of the box. But by the time you're in 2022, the company had been public for 10 years. so to me, it seemed like it was time to move in that direction. So those were four things I was hoping would happen. And they did happen.

Auren Hoffman (03:20.435) Okay.

Auren Hoffman (03:23.882) 10 years in.

Scott (03:32.584) You know, so they have happened, so I'm happy with that,

Auren Hoffman (03:34.236) Okay. That's great. That's, that's amazing. How did that when you, when you did the, like, when you have a new CEO, like, how did you work with the new CEO? Like how, how's it work? Like, or does the new CEO like, you know, cause like classically the Mark Andreessen advice for when everyone gets a new CEO is throw the old CEO under the bus. Right. Like that's like, that's like one, one way of doing it. Right. Another way it's like, okay, we're going to be collaborative and you know, et cetera. Like what happened in your guys transition?

Scott (03:54.291) Ha ha ha ha ha.

Scott (04:02.237) Well, in the case of Verus, the person who succeeded me was my CFO. And so he had been with the company for several years. so it was, and you I felt really strongly a desire to see an internal successor, if at all possible. So I had been active for years actually in creating a couple of internal candidates and the board chose one of them.

Auren Hoffman (04:29.148) Okay, cool. So the board like ran a process and then they had maybe some internal and some external or something.

Scott (04:36.334) It was more focused on the internal candidates. Yeah.

Auren Hoffman (04:38.876) Okay. Got it. And usually like the CFO is not always the best leader of the company. maybe in this case, cause it's like more financially oriented. could be like more like why, why, why do you think like in this case, the CFO was a better pick?

Scott (04:57.352) I think, well, I think there were a couple of good candidates, but the board felt comfortable with him. Lee Schavel is his name and he was well known to the board. so I think there was just, there was a comfort factor there.

Auren Hoffman (05:16.801) Now you were there for a while. what, um, you know, w w w w w w w w w w w w w w w w w w w w w w w w w w w w w w w w w w w w

Scott (05:31.441) Well, maybe I can tell you what I consider to be a couple of the lessons that I take away from the journey. And maybe I can just take a second and create a little context around all this because it's actually a story which played out over a long period of time. But I do think that some of the things which developed are good. I just think they're kind of good things to think about for our DAS entrepreneurs who are on our call here today.

Auren Hoffman (05:35.134) Yeah.

Scott (05:58.566) It actually, the precursor company to what became Verisk came into the world in 1971. And it was basically the PNC insurance industry deciding that these agencies that they had at the state level that were basically stood between the insurance companies and the regulators in order to facilitate data flow from the insurance companies to the regulators.

The insurance industry collectively in 1971 said these state level things, these state level agencies that exist, let's pull them together into a national organization. should be, should.

Auren Hoffman (06:35.848) Yeah, and it was it was like a shit. It was a nonprofit at the time, right? Yeah.

Scott (06:38.918) It was a nonprofit. So 1971, all that stuff gets pulled together, nonprofit, and basically remained in that same condition for 25 years until 1996 when it was reorganized. But two really important...

Auren Hoffman (06:52.53) And you were at the time you were like a partner at BCG like, they were one of your clients, right? Okay. okay.

Scott (06:58.413) No, they were not one of my clients, but you're right. I was at BCG at that time. And actually I didn't know the organization at that point, but the importance of that first phase of the company, I think was fundamentally two things. One was the solutions were being put out, the then set of solutions, much smaller than what's there today, but they were being put out at, they represented a good deal of value because being not for profit essentially,

the customers were getting these inputs at cost and they were reliable products. so customers felt comfortable increasingly standardizing their own processes around what it was that this company, which then was called ISO, was putting out. So that was one thing. And the second thing was,

that the company organized itself in a way that it really had a lot of interaction with the customers. Customers were involved at the governance level. There were many, many standing ways that customers were able to provide input into the products and solutions that the company was putting together. So was 25 years of...

Auren Hoffman (08:17.13) How did it go from like the nonprofit to for-profit? Like how did the equity get distributed at that point?

Scott (08:21.611) Yeah, so this is, and this is an important part of the story. So because enough trust had built up literally over 25 years, the, the, the industry was essentially, eventually approached by, by the company and said, who said, Hey, you know, if we reorganize and become a stock, you know, a stock based entity, a for-profit entity,

Hopefully we will be able to improve the performance of the company and reinvest back in and bring you yet more solutions that would be helpful to you. And that was an argument which took a while, but the industry eventually agreed. Essentially at the 25 year point, yes, okay, we agree with that. And so as the company was getting reorganized, there were two classes of stock. There was the class of stock that was given to about 250 insurance companies.

in proportion to the amount of use they made of the solutions and therefore.

Auren Hoffman (09:25.096) Basically how much like how much revenues they were to the right. So one of them was a million and the other one was 500,000. The million would get twice as much stock as the 500,000. Okay.

Scott (09:27.647) how much exactly how much they were spending.

Scott (09:35.413) That's right. Directionally, that's exactly right. And that class of stock had 90 % of the economics of the business, meaning it owned 90 % of whatever the value of the company was. But there was another class of stock that was put together, and that was 10 % of the economics, and that was an ESOP. And the ESOP, as it turned out, had a fair amount of the voting rights at the board level. And so...

So you have a company which becomes fairly agile.

Auren Hoffman (10:06.426) So it's employee controlled, like pretty quickly, which is rare for a company of that size.

Scott (10:12.636) Correct, although it was much smaller back then, but that's exactly right. And so that's why, know, I basically, that was the first 25 years. The second 25 years runs to the end of 2021. And that was when I was there for, you know, almost all of that. But you needed that foundation of depth with the customers in order to be able to make that kind of transition. And so I just really call that out because I used to...

frequently say that I felt like I was standing on the shoulders of giants because they had spent all this time sort of creating this depth of relationship with the customers and a degree of connection and trust, which enabled it to be reorganized in the way that we just said. So basically you have a new company in 1997. It doesn't make any money. It doesn't grow very fast. Doesn't do business overseas.

didn't write a line of customer facing code. It had to change. And that analysis in many ways was basically actuarial science. There might've been five people around the company that use generalized linear models to kind of model something.

Auren Hoffman (11:26.068) So various versus growing a lot. Like if you just look at this, when we're as we're recording this now, the share price is roughly like $275 a share. It's 40 billion market cap company, which is like amazing. But like, could you, is there something you think you could have done where it could be like a thousand dollars a share right now? Like, is there some, is like some ways to have like really like, like is there, was there a 10 X thing that like, you're like, I wish I could have done this or something or.

Scott (11:46.82) What?

Scott (11:56.382) Yeah. Well, I, you know, we went through some, evolutions where in 2009, we went public 2013. We became a component of the S and P 500. And like at the beginning of the journey for me, if you had told me that we were going to be an S and P 500 company, I would have just thought you were crazy. Like how, how in the world could that happen? But, um, you know, we, what I would say about the journey is we had, we had a playbook.

Auren Hoffman (12:15.634) Yeah, yeah, yeah.

Scott (12:25.179) that fundamentally sort of featured five steps in it. The first one was to try to get as much proprietary data as we could. The second was to turn the data, whether proprietary or public or mixing them all together into what I call analytic objects that became kind of industry standard, scalar value kinds of things that customers would use, pull into their decisioning. The third was to have enough service and support, but not too much.

enough so that we could help customers get value out of their use of an industry standard solution that their customers, their competitors were also using. And to be close enough to see how they were using it so that we can make it better. The fourth was to wrap all that with software, whether it was analytic software or more kind of workflow software to get our signals into the customer's systems. And then the fifth was to expand the solution sets.

Because once you've sort of created that software link with the customer, it's like you put a tool belt around their waist, and now it's easier to put new products, to hang new products on that. And so those are the five steps. And I'd like to think that we did a good job at each of those five points, but I really think what got us as far as we got, you so it became a, I don't know, a $35 billion.

enterprise, total enterprise value company by the end of 2021, by the end of the second 25 years. I think what was really the most important thing was the rate at which we were running around that circle. We were, I think we were running good plays at each point around that circle, but I think it was actually the rate at which we were running around the circle that was kind of different. So could we have run faster and would that have created, you know, a $70 billion or maybe a different circle?

Auren Hoffman (14:15.818) Or is there a different circle or something? Yeah. Yeah. Yeah. Yeah. No, Verus is one of the, it's one of the most successful data companies, but really almost no one has heard of it. Like of all the S and P 500 companies, it's one of the least well-known company of the investor class. Right. Now is that, is that being relatively unknown? Is that a feature or is that a bug? Like what, what, do you think about that? Cause you could think of it both ways, right?

Scott (14:19.576) I don't know, but...

Scott (14:33.498) Right?

Scott (14:44.218) Yeah, you know, I think that I think that for the the the, you know, the public markets, I think I think that the investors who ought to be interested in a story like Veras and Veras find each other. I don't think there's any real gap there. then otherwise, you know, the profile that you get from from being public. mean, I, you know, a lot of it is.

Auren Hoffman (15:07.946) I mean, maybe you can like recruit better people, maybe, you know, it's, don't know, like, I'm just kind of like, obviously you can make up lot of cases that it should be better known. Maybe the stock market, maybe the stock price jumps a bit. You know, you have more retail people in it, et cetera. Of course, not being well known also gives you all these advantages too. Like, I don't know which way that's out.

Scott (15:30.273) Yeah, you know, one of the things that comes to mind as you ask that question is not infrequently when I would go and visit the CEOs of our customers in a nice, in a nice way, they would sort of tease me about our performance, you know, kind of they can see that we were doing well and, know, high margins and yet.

Auren Hoffman (15:48.522) All right, right. And they're like, hey, you're taking more. You're raising prices too fast or something. Yeah.

Scott (15:53.866) Yeah, like, why are you raising? Right. Exactly. you know, like I'm over here trying to make my, my company go. So I guess I always thought of the, you know, the profile in the public markets as being kind of a mixed thing. And the messages we wanted to get through to customers in order to, you know, help them to see the value of what we were offering and hopefully to encourage them to adopt. I felt like that was in our hands, you know, whether we were public or private. So I didn't, I don't know.

I didn't worry that much about our being a household name.

Auren Hoffman (16:27.05) Yeah. I mean, I know like CEOs go through this as well. So I know many CEOs, I know they're like, okay, should I, I'm not on social media or I am also like, and there's pluses and minuses of like being well known both as a company and being well known as CEO. Obviously you want to be well known to your customers and your market. Um, and then, um, but like, so, you know, it's like, I don't know, Flexport, like I'm not a customer of Flexport, but I know so much about them because like they're out there, the company's out there, Ryan Peterson, the CEO is out there a lot.

Scott (16:35.648) Hmm.

Scott (16:43.039) Yeah, exactly. Exactly.

Scott (16:53.345) Uh-huh.

Auren Hoffman (16:56.67) I read them all. So it's like, kind of know a lot about the company, even though like I'm never, I'm not a customer. Like there's no, there's no reason for them to market to me. Maybe when they eventually go public, like maybe I'll be more likely to buy their stock or something. I'm not sure.

Scott (17:03.307) Yeah.

Scott (17:10.143) Yeah. No, I, yeah, I hear you. You know, there's another dimension of kind of being known and what you're known for. And, this also, I think is an interesting point for, you know, folks that run companies that share some of, know, what goes on at Veriscore at your companies and et cetera. And that is in your desire to do as much as you can to add as much value as you can, how far do you, or do you not get away from

you know, what might be considered sort of the center of what you're doing. So it's been, it's been the case from the beginning that the law, the, by far the largest revenue stream and the, you know, the greatest part of what Verisk has been has been serving the property and casualty insurance industry. But there were moments along, along the journey where we chose to try to move into other vertical data analytics. Right. Right.

Auren Hoffman (18:03.924) Where you guys bought Argus, you bought some of these other things, right?

Scott (18:08.597) And, you know, one part of the story, by the way, which I think, you know, naturally sort of gets lost as you move forward in time is the company went public in 2009 based on 2008 financials. And in 2008 revenue grew about $95 million. And the reason why that's interesting to me is about half of that growth was in the mortgage analytics business, not, not the core.

Auren Hoffman (18:34.698) Very insane.

Scott (18:36.692) property and casualty set of solutions, about half of it. So it really is the case that when the company went public in 2009, it was based on performance, was the growth part of which at least was pretty substantially mortgage analytics. And then in the time period from about 2010 to 2012 or 13, so shortly after we went public, the greatest excitement

Auren Hoffman (18:38.334) Yeah, yeah.

Scott (19:03.572) on the street where the company was concerned was the healthcare analytics business because it was growing much faster than the PNC business. And so it's just an interesting thing about you try as many things as you can to try to grow your business. But as I said before, by the time we got to the end of 2021, what I felt I was seeing, at least the perception of the company out in the marketplace was

Your property and casualty business is so pretty and so optimized. Anything else you've got inside the company is just going to look like the redheaded stepchild. And I felt, I felt.

Auren Hoffman (19:37.641) Yep.

Auren Hoffman (19:43.658) And by the way, it depends like where you are too. Like it's like in this property and casualty, like versus like the clear number one, like it's not even a close number two in what you, in what it does, but there are other businesses where like, you know, you don't want to get into like being like the number four player or something. Right. So it also depends on like, yeah, it'd be great to have like six businesses where you're all number one and two, right? Like that would be amazing, but it's it's just hard to do that. Right. Like, you know,

Scott (20:11.238) Yeah. And I think that, I think that in that second 25 year phase, we tried many. And I think what we proved was that it was, it was hard to gain as much advantage that five, that five point wheel. was just a little harder to make that work in these other domains, maybe because of their structure, but also just the compare and contrast your point about are you known and what are you known for? mean, when you've got something that is so strong and then you've got something which is not.

Auren Hoffman (20:25.31) Yeah.

Scott (20:40.817) As strong, just naturally draws attention to the thing which isn't as strong. And I concluded by the end of 2021 that as kind of around the time of my departure, that it just the optimized business was a focused business. you know, the, the entrepreneurs that are listening to us today, you should think about, can you extend, you, can you change the surface area of your company, but be aware of the fact that in the end, what will get rendered is.

the strength of the thing that is maybe your core and then the strength of all the other stuff. And like there just can naturally be a reckoning. I don't regret.

Auren Hoffman (21:16.52) Yeah. And by also if like you focus on like, there's might be ways to focus more on the core and make that business way better. Maybe there's way to expand it. Maybe there's like where to grow it. And so the, as people, like if they try to diversify, then they're going to lose focus. It's like, if you're an oil company and then you, you you like getting oil back in like the seventies bought all these financial services companies and stuff like that. They even own like ESPN at one point.

Scott (21:22.894) Exactly.

Scott (21:42.158) All right.

Auren Hoffman (21:42.792) Right. and it's like, yeah, it was like, maybe that was smart in some ways, but like they were oil people, like that's what they knew. And then they, they actually, their oil business started to decline because they were starting to focus on all this other stuff that was out there.

Scott (21:56.976) Yeah, exactly. And so it's kind of the both and quality of it in that, you know, mean, if we, we in 2009, when we went public, if we did not have the growth associated with the mortgage analytics vertical, like would we have gotten out or would we've gotten out at this, you know, at the same equally good condition. And we enjoyed at least three years of real favor in the market because of the healthcare analytics business, not the PNC.

business or at least not so much. And so it's on the one hand, but then on the other hand, you know, by, by, know, the end of all things, you know, you just, you, you sort of have to look at the relative performance of everything. And that's how, how everybody else is going to look at you too. So it's, it's a both end.

Auren Hoffman (22:43.934) Now Verisk and Visa, they both started as nonprofit industry consortiums. What are some other examples of companies that like made that transition from nonprofit to for-profit? Like what can we learn from those?

Scott (22:56.995) Well, I don't know that there have been a great number of them, but.

Auren Hoffman (22:59.57) No. Yeah. mean, obviously there's like open AI right now, which has just done that or is in the process of doing that. and they're probably like the most famous one at the moment, which is making that transition.

Scott (23:11.148) Yeah. So I, you know, I always thought that a reasonably good analog were Visa and MasterCard. And, you know, ultimately you're going to get, you're going to get judged on, are you actually creating value for customers such that they want to buy your solutions? And then if they do, then you're going to get rewarded for that. And, and, and then, you know, the performance that the market likes will follow. So, I think that.

Auren Hoffman (23:26.152) Yep.

Scott (23:40.237) But what I would stress is if you started out in that not-for-profit mode, were you creating value for your constituents then with really good solutions that are being very, very competitively priced because you're not even trying to make money, so you're selling them essentially at cost? And are you really, really engaging with the industries you're serving?

Auren Hoffman (23:54.216) Yeah.

Scott (24:08.446) in a way that there's trust and relationship building up. There was 25 years of that before I even showed up, you and that's really valuable. So I really encourage our entrepreneurs, whether they're starting not for profit or they're starting for profit, just to lay that foundation, you know, it's just, it's gonna serve you well.

Auren Hoffman (24:15.154) Yeah, yeah, that makes a lot of big difference.

Auren Hoffman (24:28.682) Now, when you think of companies like Visa or MasterCard, like they're sitting on this, this is like a treasure trove of data. How would you advise companies like that to monetize it or think about monetization and that type of data? Yeah, of course. Yeah.

Scott (24:41.91) Well, they think about it, first of all, they definitely want to do it, but they are appropriately very sensitive to how their customers feel about them reusing the data, repurposing the data. And I would imagine in both cases that they have gone about as far as they can because they know that it's a good idea.

if they can, but basically, but the pathway to monetization is going to be to anonymize the data, tokenize the data so that it's highly secure and, you know, so that there's, there's just no shadow across the idea of doing it. And then you probably need to think hard also about what's their incentive for you to monetize the data that they've given you access to. Do you need to provide them some incentive so that they'll lean into you doing it?

Auren Hoffman (25:14.846) Yeah, cohorts or understand. Yeah, yeah, yep.

Auren Hoffman (25:31.497) Yep.

Auren Hoffman (25:35.176) which could be like giving them access to the insights or giving them price breaks or something like that. Yeah. Yeah.

Scott (25:39.921) or both right. In the case of Verisk, the same contract in which a customer agreed to buy our solutions, they also gave us access, they gave us rights in the data in order to be able to create the solutions. And then when you're negotiating the contract, we were very open to discounting the contract, at least to a degree, in order to have or even expand data rights.

Auren Hoffman (25:50.76) Yeah, it's just classic co-op. Yeah. Yeah.

Auren Hoffman (26:03.53) Okay. Interesting. Now, like so many companies struggle with like monetizing their data effectively. Like do have a framework for like determining when data has some sort of genuine commercial value versus just when it's just like quote unquote interesting.

Scott (26:20.298) Uh, you know, I would, I would sort of walk to the other end of, of, of the question that you're asking, or an, and, kind of put it this way. You know, if you and I, well, when I, when I began my career, which was quite a while ago, if I had wanted to get a petabyte of storage capacity, probably would have cost like $8 million. I mean, the kind of thing that would rise to the level of the board of directors deciding to approve it. Now today, if you and I wanted to get a petabyte of storage capacity, we could rent it.

Auren Hoffman (26:43.167) Yep.

Scott (26:50.331) in the cloud for what $10,000? mean, whatever, wherever it's going at, right? It's very right exactly. And so my starting point is in this world that we're in where it doesn't cost very much to first order capture the data. Well, then grab the data. You know if you're in front of it like grab the data and so always be asking.

Auren Hoffman (26:53.546) I actually don't know the cost, but it's very low. Yes. Yeah. Yeah.

Auren Hoffman (27:09.522) Yeah. And most people are people, most people already do, they're already like getting the data. already like, you know, maybe not in a smart way or something like that, but they are like capturing it. Like most people are not like deleting it today. Yeah.

Scott (27:20.115) So then the next thing where I would go to next actually is be capable of using it in a very high velocity, low cost sort of a way and be capable also of bringing in the next data sets and putting them up alongside the ones you've already got and.

Auren Hoffman (27:41.994) Yeah. Well, that, I would say most, that's where most people fail down. It's like joining the data sets is, is non-trivial and there's like, there's some entity resolution. Also, it means like, have to, you have to understand like not all your data is good. Some of your data is bad. So then you have to be like fixing the data and you know, all data munging and et cetera.

Scott (27:46.76) Exactly. Right.

Scott (28:00.337) Precisely.

Yeah, so, you know, basically create your data as flat and denormalized as you can, and then build really good data fabric in which you can actually sort of reach in, pull it up and begin to make use of it. And so if you're not spending very much in order to grab the data and you're not, you're not having to spend a lot in order to be able to access the data, then to me, the premium goes to be in close touch with your customers.

show them something that is novel that you just came up with, see if it's starting to resonate with them, and then pay a lot of attention to, don't just back your truck up to their loading dock and give them this new synthesized set of signals, but understand what they do when they pull it off the loading dock into their own environment. And now maybe you're really getting some insight in terms of what do they need.

Auren Hoffman (28:36.948) Yep.

Auren Hoffman (28:58.282) What are your thoughts on this? Like all these companies now have like chief data officers. Like what's your thoughts on that?

Scott (29:05.348) I think that a chief data officer can be very difference making at particular moments in the journey for a company. would say especially if a company has not really given a lot of attention to monetizing data or is not yet really well organized to make use of it once it has it, then your chief data officer can be your point person.

Auren Hoffman (29:33.514) I don't even know, like I'm in the data world my entire life. I have no idea what a chief data officer is, what it does. Is it just like a glorified salesperson? Is it a glorified BD? Sometimes they have this huge org under them. Sometimes they have like one person under them. know, like I have, you know, sometimes it's just like some random, like it's like three consultants in a company or like, it's like, I know what like the, the, the head of engineering does like the, you know, the

Scott (29:47.28) Ha ha ha ha!

Scott (29:56.037) Right.

Scott (30:00.9) Mm-hmm.

Auren Hoffman (30:01.258) person who like, all the engineers that you product officer does, what, what is it? Is it, do they do? Like, and, and why is it, why is it even valuable?

Scott (30:09.4) Well, let's start with that. What's the purpose of the role to me fundamentally?

Auren Hoffman (30:12.072) Like to me, the purpose is just like, give someone like who's smart a title. We got to give them like a cool title with a C in it. but they don't really, it's like, they're kind of a glorified like spokesperson or something. And they sit on some panels and stuff.

Scott (30:26.9) Well, hopefully not that, but I understand. I understand. I understand why you say that. I think of a chief data. Well, your data should be thought of as an asset. And there are a lot of people that are advocating for different things you're trying to get done inside your company. There are people that are advocating for the customers. There are people that are the engineer, the engineering crew is advocating for change, changing the processes or.

Auren Hoffman (30:28.38) Okay.

Auren Hoffman (30:40.339) Yes.

Scott (30:57.107) know, rewriting the software to accomplish a certain set of things. So you've got people that are advocating for different things. The chief data officer should advocate for the maximum value of your data asset, should maximize the value of your data asset.

Auren Hoffman (31:09.822) Yeah, okay, got it.

Okay. So in some ways they're like the capital allocator for your data. Their goal is to understand that.

Scott (31:18.646) Well, they should also, you one of the things that you get data, many companies get data in a lot of different ways, which can be a little bit haphazard. You know, in other words, some of it comes from you run your processes. Some of it could be that, you know, you buy it. but is there kind of a comprehensive view of, look, this is what we've got and this is what it's worth today. If we added to it, if we did something different with it, here's how, here's how and why the value of it might go up.

Somebody should be thinking about that. To me, that's fundamentally what the CDO ought to be doing.

Auren Hoffman (31:54.014) Now you left Verisk, think literally like three or four months before chat GPT came out. so like, and so like the entire world in some ways has changed in the last two and a half years. Like how, how should companies be thinking about like the world of AI?

Scott (32:03.798) Right.

Scott (32:11.734) Yeah. So I don't think many there would, I don't think there are too many companies out there that would see themselves as being direct competitors of an open AI or of an anthropic or any of the people that are kind of at the level of the large language. Yeah, right. Exactly. And, you know, I, I'll just, I'll just, you know, side comment by the way.

Auren Hoffman (32:28.04) Yeah, there's probably 10 or something. Yeah, yeah.

Scott (32:38.207) I mean, those foundational pieces are extraordinarily valuable. I do think it'll be interesting to see how much of the profit, the surplus that gets generated by AI methods flows to the providers of those foundational layers versus those who sit on top of them and essentially try to make use of them almost as tools as they try to sort of up.

Auren Hoffman (33:03.85) And how do you think like, like, this is like right now there's like, there's roughly let's say 10 of these, 10 of these companies that are out there spending gazillion dollars each on building these models. Now, in some cases, like one has the clear leader, Anthropic right now, at least it's the clear leader for code. So if you want to write code, pretty much everybody like builds stuff on top of Anthropic, the clear, obviously like leader for the

Scott (33:20.629) Right. Exactly.

Auren Hoffman (33:28.36) understood like consumer sentiment and using the consumers open AI or maybe Grok starting to come in and stuff like that. but as they like, if they're like, if they're like roughly the same, then I assume like, then they're just going to keep lowering their price, right? If they're roughly the same and then it gets out of way.

Scott (33:44.147) Well, in the end, the, and the end around of somebody like deep seek, you know, who basically went open source and then we'll, you know, we, we work hard to, tune it up. I, I personally think now I'm biased because my, you know, my work has been in vertical spaces, trying to be intimate with the data and trying to be intimate with the customers.

Auren Hoffman (33:48.434) Yeah, exactly. Well, it's easier to just to yeah, exactly. Just to

Auren Hoffman (33:56.958) Yep.

Scott (34:09.875) But I really do think that a lot of the value here is gonna be experienced by those who can kind of use those things almost as tools, as inputs, and then find a way to generate insight that's really valuable and not easy to get to. So it's kind of like small AI rather than big AI. And that's a lot of what I'm involved with today, the companies I invest in, et cetera. That's where they sit. So I...

You know, I would expect that the kind of disruption that came when DeepSeek showed up, I don't think that's the last time we're going to see something like that.

Auren Hoffman (34:46.174) Well, I assume like in the data world, like you have any resolution, like that's something where AI can play huge. You have risk modeling where AI can play. any type of like any type of models that people built before, we built these very, very, very specific type of models. I assume that AI could probably make much better, allow you to do quicker. So someone, if someone's been spent, if someone spent like five years building this very, very, very proprietary model, like they're going to have some competitor come at them.

in a way, right?

Scott (35:17.085) I, yeah, no, I agree. it's, yeah. I mean, I think that, I think that, my own thesis would be that if you are a company that is already a leader in its space and there's kind of a content richness to what you do, you ought to be able to amplify your advantages by making you, you know, in this AI moment, in this AI motion, you ought to be able to.

Auren Hoffman (35:39.721) Yeah.

Scott (35:43.643) I'm not sure every company is. In fact, I think that many of the incumbents are kind of sort of trying to, I mean, they know they need to be doing something. Like you'd have to be brain dead if you're not doing something on AI, but I think a lot of them are still, it's,

Auren Hoffman (35:59.274) Just like chief data officers, all have chief AI officers too now. I'm not sure what those people do, but yeah.

Scott (36:02.884) Yeah, right. Exactly. Yeah. Well, I'm not sure what those people do either. Right. But, so I think that, I think that. Let me, let me put it you this way. When AI is doing everything that it's supposed to be doing, it just presents as software. It's like, okay. That's automated and it does what it's supposed to do. And you know, when you think of it that way and you think about software.

know, chunking along, even if it's highly automated, we always worry about is the human in the loop and in what way. So there has to be adaptation here where let the AI take the first draft and the second draft and a human is in the loop somewhere, but take the efficiency of it for sure. And you mentioned code writing before. That's one of the strongest motions right now is code writing.

Auren Hoffman (36:50.696) Yeah, for sure. Yeah. I assume any, any type of writing, any type of, mean, in some ways like AI itself is, is, is just by default deflationary. and so you should see it lowering costs in your own organization, but because of that, you, you, you, your competitors are also doing that. So that means you're going to probably have to pass some of those savings onto your customers by lowering prices as well. So I think we'll.

Scott (37:16.805) Do you think AI will end up being deflationary at the societal, the national economy level? Do you think it'll kind of have that effect?

Auren Hoffman (37:27.53) know if it'll be, but for like, for companies that are in the data world where your production is data, your production is software or something, um, it will, it will allow you to do a lot more with less resources, with less dollars. Even, even just like the average engineer today is probably at least 30 to 50 % more productive than they were a few years ago. So just by deep, like there are

Everyone is becoming more productive. So that that is that's in itself deflationary, right? That engineer you spend a lot of money on is way, is way better than they were. And you're not really spending that much more on that engineer today than you were two years ago. So I think we're going to, we'll see scenarios where companies are going to like, they're, they're going to become more profitable in the short term, but then at some point you got to pass those savings onto your customer. Yeah.

Scott (38:16.843) Yeah, customers will expect that. think you're right about that. You know, and at the intersection of, you know, another thing that has been at work inside of our knowledge intense companies, and that is offshoring to human beings. So if we, if like what happens with that motion and then you overlay AI on top of that, I mean, it really is an interesting question about talent.

Auren Hoffman (38:37.002) Yeah. Well, I think, I think the first place AI attacks is everywhere you've offshored. So the, would be at least short-term short on India and Philippines and stuff like that. Cause I think those guys will get hit the fastest. Anything you're BPOing today is probably something where AI can like do a decent job. Um, and you know, where if you're paying like someone in the United States, like a gazillion dollars to go do something, maybe.

Scott (38:58.425) Hmm.

Auren Hoffman (39:05.406) Maybe AI is just going to augment them, make them a little better. whereas like in, in place, again, it could actually replace that person.

Scott (39:12.862) Mm-hmm. Mm-hmm. Yeah, that's it. Yeah. Remains to be seen.

Auren Hoffman (39:17.864) Now you're okay. You've, you've, you've spent a lot of time in the insurance industry. It's gone through like a pretty crazy past few years. think 2024 was showed like the first underwriting gain and in a while. what's the overall state of the industry.

Scott (39:33.185) I think it's always innovating underneath, but if you're looking at it from the top down, I think that there is change which is occurring, but it's interesting, the insured techs, the companies that started out as, they basically felt that their major innovation was the ability to differentiate risk and to attract customers.

the so-called insure techs. They haven't swallowed the industry and they've been at it for a while now. In fact, some of them kind of have plateaued a little bit. So you had those kinds of changes. There's been a lot of speculation that maybe the capital markets would just kind of step in and disintermediate and what effect would that have on global reinsurers? And there's been some of that. There is some securitization, but

there's still a role for global reinsurance. So I think that structurally it kind of looks more like it used to and probably will continue to than not. The profitability that you were talking about, I we had this real major effect coming out of COVID, which was inflation in a lot of factor costs. And so now you're trying to

Auren Hoffman (40:56.222) building costs and stuff.

Scott (40:57.109) Yeah, exactly. So now you're trying to settle a claim and wait a minute, how much does a two by four cost in Philadelphia? Wait, what? You know, and the labor. Yeah, so I think that when you're looking at 22, 23, you had a fair amount of that, but I think the industry has sort of caught up with some of that.

Auren Hoffman (41:03.518) Right, totally, right. And the labor, of course, yeah, has gone up, yeah, so much.

Auren Hoffman (41:19.306) The industry is also like, they're just also just exiting markets. So in many markets, like when I was, you know, when I lived in San Francisco, I had one option. I had only one. Some of my friends, depending on where they live in California or in Florida, they have zero options. They have no way of insuring their homes today. Uh, so yeah.

Scott (41:37.033) Well, there are the risk pools that the states put together as the insurer of last resort. it is interesting, like the Southern California fires, the terrible fires that happened early. I think when the story is all told, one of the major parts of the story will be how many people were underinsured or not insured at all.

Auren Hoffman (42:00.5) Well, yeah, I think because I think a lot of these, a lot of their insurance companies have pulled out over the years. I have a friend in Healdsburg, California. They built their dream home. And then they realized right after they built it that no one would insure it. So they were close enough to a fire zone that nobody wanted to take that risk. And when you have certain properties of certain sizes in terms of dollars, like the state's not going to really come in either. So they're essentially self-insuring their own property.

Scott (42:13.277) my.

Scott (42:19.604) Hmm.

Scott (42:30.372) Yeah, yeah. So, well, I think, you know, probably in some of the higher risk places, I mean, people still like to run to the coasts. They like to be on the beach and build expensive houses there. And so you're putting yourself, you know, in harm's way. You're consciously putting yourself in harm's way.

Auren Hoffman (42:51.998) Yeah, totally. Yeah. Yeah. You consciously are doing it. yeah, yeah. It's just, it's just tough. it's, it's really hard. Now you recently became chairman of one incorporated, which processes like almost a hundred billion dollars, annual payments across like almost a million vendors. Like what's broken, about how like insurance payment flows work today.

Scott (42:59.858) Yeah.

Scott (43:15.922) I just think that as an insurer, you naturally are giving a lot of attention to things like segmenting risk, selecting risk, pricing risk. That's the guts of what you do. And so you naturally need to send money out in the form of claims. You also receive money in the form of premium payments. But if most of your attention was going somewhere else, then I think it follows that

maybe your methods with respect to payments in and out just haven't modernized as much as maybe some of the other things. so that creates then.

Auren Hoffman (43:54.73) I mean, there are people who like, there are people in the fires who like they, there's so many people who like the insurance companies could only pay them by check. And there's so many scenarios. There's all these stories about how the check got sent to the wrong address or got sent to their old address, which was literally burnt up and stuff like that. They couldn't access that check for many, many weeks. It's just crazy.

Scott (44:03.622) Well, that's.

Scott (44:16.228) Well, that's exactly, you know, that's sort of the legacy of where we have been and the way we have been.

Auren Hoffman (44:23.572) Now, are they sending the checks? I thought they were sending the checks because they were just trying to keep the float for as long as possible. So they're just being jerks and sending the checks, but you're, you're saying they're sending the checks because they're just, they just don't have another alternative to send the payments.

Scott (44:36.324) Well, yeah, and also you just want a feeling of security with your insured just that they feel good about the form of the payment they're getting and et cetera. So if you're gonna get the insureds to be, I'm thinking of consumers, to be comfortable with being paid in other ways, you may have to do a little bit of work. And for all of those reasons, focus on the modern methods, work the network, make sure that the endpoints are

Auren Hoffman (44:48.104) Yeah, yeah, yep.

Scott (45:06.434) more than happy to, in effect, desire to receive payments in these more modern ways. Like that's a lot of work. And so it creates the opportunity for a third party to come in and focus on just this one thing and really get it right and really get it optimized. And that's why there's the One Ink, which is growing very, very rapidly because now it just seems to be a moment when a lot of the insurers are willing to open up to a new and different way to manage payments.

Auren Hoffman (45:34.026) Now you're now spending more and more of your time on boards. Like what are your thoughts of how to be a good board member?

Scott (45:43.023) Well, I would start with the thought that the most important work that a board member does is not in a board meeting. It's between board meetings. And so because

Auren Hoffman (45:51.209) Yes.

Auren Hoffman (45:54.942) And that is, what is that? that getting to know the company is building, is that understanding what's happening with a team?

Scott (46:02.594) I think it's doing the work to really understand what the issues are. And then it is being available in a way that makes sense to the management team to actually talk things through. A board meeting is going to be more for ratifying decisions basically, but the actual deep work and thought. So we're trying to figure out how to...

Auren Hoffman (46:22.503) Yep.

Scott (46:31.842) reprice what it is that we do. Okay, sit in on the pricing meeting if the management team wants you, you know, and contribute your thoughts to that. Advocate for the company out in the marketplace. If you know people that could be customers or partners, like do the work, advocate for the company. So the most important thing is that it's not, it doesn't happen in the board meeting.

Auren Hoffman (46:38.164) Yep.

Auren Hoffman (46:53.99) Mark Zuckerberg at Metta, he's got two kind of boards. He's got like his traditional board, that we've all heard about. He also has a product board. Now, some of the board members on the traditional board are also on the product board. but these are like very, very deep into product stuff and they, and they do like the product reviews with him and that can you imagine, and they're all outsiders who, and they spend quite a bit of time, you know, with the product team and his company like.

Scott (47:06.73) Also, right, right.

Auren Hoffman (47:23.316) product is the most important. You can imagine something similar, another company instead of product, it's whatever is the most important thing for that company. Yeah. Yeah.

Scott (47:29.355) Yeah, whatever is the most important thing. Right. Yeah, exactly. Right. And, you know, board members, I mean, there's, there's literal sort of governance kinds of things that board members do, but I think really helping the company to go. And I, you know, so meta, you know, public, would say, especially if you're in a private company framework, you're not having to worry about much of the public governance things.

Auren Hoffman (47:55.092) Correct. Yeah. Then you might as well just like dive in and help. Yeah. Yeah. Yeah.

Scott (47:56.65) You're liberated. You're liberated. Work on the business. You know, help it to be a better, you know, more, you know, more rapidly growing, more profitable, better for customers. Like work on that.

Auren Hoffman (48:07.656) Now, when I'm sure at Varis, you had a wide variety of board members from insanely helpful to maybe not that helpful. was there something about the personality of the people that were insanely helpful that you could like pattern match somehow? Like if you're recruiting board members, if you're advising, as they recruit them.

Scott (48:32.458) Well, I think it's not particularly helpful in a board meeting when an individual board member will kind of make a speech or kind of speak ex cathedra and like, here's the thing that you should do. So first of all, those things I talked about before, like interacting between board meetings and the things, like really helping to get.

Auren Hoffman (48:45.502) Yeah, hijack it.

Scott (48:59.742) the thinking tuned up and advocating for the company, those are really, really important things. But I would also say the ability in when you're sitting with others and the ability to put out an idea, not as kind of a settled conclusion, but more, have we thought about this or that? And now the CEO, she or he can really kind of take that on and take that away.

Auren Hoffman (49:20.158) Yeah.

Scott (49:28.231) Yeah, maybe we haven't thought about that enough. you. So there's a way that you can push people without being pushy.

Auren Hoffman (49:30.986) Yeah, in an appropriate way. Yeah.

Yeah. Yep. Okay. That makes a lot of sense. Now, if you think these Pete more PE backed companies that are out there, I have this belief that like, in the 80s, like the best run companies for the PE back companies, but now today, like the worst run companies are the P companies, like they're just like super bloated and stuff like that and bureaucratic, but you've had a lot more. You've had a lot more experience with PE than I have like,

Would you agree? you disagree? Like, how do you think about like PE back companies?

Scott (50:08.359) Well, I think that a broad brush really kind of doesn't fit. First of all, when you look at the kind of league tables for PE firms, you can see substantial differentiation in performance. So let's start with that, that there's not just one monolithic way that it works. I think maybe the dividing line a little bit more is...

Auren Hoffman (50:13.022) Yeah, of course. Yeah.

Auren Hoffman (50:22.462) Yep.

Scott (50:36.348) there are moments when a company could maybe really take off if there was a focused, thoughtful program of investment to try to build on or build things that aren't in place right now. And if that gets missed because the orientation is, let's make sure that above all else that, like EBITDA is mounting rapidly and so there's a strong orientation towards

you know, only cost takeout or, you know, another play that I think it's very reasonable to think about is price. Like, you know, should price be raised? So those kinds of levers are naturally going to get thought of, you know, on almost all occasions. You're just naturally going to ask those questions. And there's no reason to resist asking those questions. But what I'm trying to say is if that's the playbook,

but the company actually could be something much more than it is, which probably would lead to even more value increase. Let's make sure that we don't miss those, excuse me, we don't miss those ideas. so what's in the company's playbook? What's in the PE company's playbook? And I think there's different personalities to the different firms. I, yeah.

Auren Hoffman (51:54.216) Yeah, they're all different. Now, a few personal questions. You're one of the small group of executives and CEOs and who talk openly about their faith. We talked about this a little bit on the last time you're on World of Death, like three or four years ago. like what, what, you know, how has that kind of faith informed your leadership?

Scott (52:17.465) Well, I guess I would say a couple of things. So I'm a Jesus follower and I have been for my entire adult life. And I would say two things about that journey. One, I have spent countless hours sitting in groups of people and we all have the same book open in front of us and we're all looking at the same words and we're going over them and what does it mean? And then we come back to them and you come back to them again and again and again.

Auren Hoffman (52:46.578) Yep, like a Bible study or these other types of things. Yep.

Scott (52:50.122) Right, and also, you know, maybe some some creedal things that you would say and the average, you know, worship service. But my point is, I know the effect that it's had in my life to come back to the same big ideas, the same verses, the same words over and over and over again, it actually changes you. It changes how you think. And so I've always had it in mind in it when I had the opportunity to provide leadership.

Auren Hoffman (53:05.577) Yeah.

Scott (53:17.322) state the big ideas and then come back to them over and over and over again. That's why I felt so strongly about authoring something called the Verisk Way. And I would open many, many meetings with people around the company by going over some part of the statements in the Verisk Way because I know the power of it in my own life to go back.

Auren Hoffman (53:37.48) And even then, like you can, imagine like with a biblical text or verse or something like that, you have many people who might interpret it different ways. And then even yourself, you may interpret it different ways over your life.

Scott (53:49.719) Yeah, right, right. So keep talking about it. Exactly. And the other, I'd say the other part of it for me is that there's a natural, I mean, I went through a major change in my life when I was 23. I did not grow up as a Jesus follower. My family didn't go to church, but it had, know, that change occurred for me in a very short period. A friend that, well, so I was about a year out of college and

Auren Hoffman (53:52.125) Yeah.

Auren Hoffman (54:10.346) What was the story? Like, why did that happen? how did that happen?

Scott (54:18.942) everything circumstantially in my life was fantastic. I had a great job, great circle of friends, just everything was, you I'd had a wonderful time in college, et cetera. And I just realized that I wasn't happy. And it was scary to me because it was like, wait a minute, if I'm gonna get everything I want in life and I'm not gonna be happy, then maybe I'm never gonna be happy. So I started describing my condition to anybody who would listen to me.

Auren Hoffman (54:32.094) Hmm. Okay. So it's like kind of a classic thing. Yeah.

Scott (54:45.89) Basically, but especially friends and one friend said, well, if I got you a Bible, would you read it? And I said, sure, you know, and so he did and gave it to me and he put a bookmark in and a place in the Bible, the Christian Bible that there are these four, the four books, which summarizes Jesus when he was on the planet. The fourth of them is the book of John or the gospel of John. He put the bookmark in there. So I think I took it home that night.

Auren Hoffman (54:46.05) Hahaha

Scott (55:15.86) and started reading it, and I thought, wow, this Jesus guy is just like the coolest ever. And that was it. I had never read the Bible.

Auren Hoffman (55:20.97) So you, you had never read the Bible at that point even? my gosh. Wow. Okay. So you really had grown up quite secular to not have read. Okay. Cause interesting. that, wow. Okay. And then, and then after that you just kind of like that kind of hooked you in or. Yeah. Yeah.

Scott (55:29.431) Yeah.

But anyway, but you're asking, what is it about all that that informed the way I led? So one was commit to the dominant ideas and go back to them over and over again. The other is to believe in the ability of people to be transformed. so invest in them, invest in their growth, in their development, believe in them when you give them a bigger job, stay close to them, help them. But having experienced a form of personal transformation.

Auren Hoffman (55:42.312) Yep. Repeat. Yep.

Auren Hoffman (55:49.353) Yep.

Scott (56:00.53) myself, I just know that it happens. And so I lean into

Auren Hoffman (56:03.966) So many people also they like they rise up when people believe in them. So it's like almost that's like that's just that's like that's missing ingredient that they need to believe in them and stuff.

Scott (56:08.137) Exactly.

Scott (56:16.318) And so leadership for me was and is very personal. It's very personal. Yeah. Yeah.

Auren Hoffman (56:20.242) Yeah. Yeah, that's cool. Okay. Almost the opposite question, but a question we ask all of our guests now, what's a conspiracy theory that you believe?

Scott (56:27.754) Ha ha ha.

A conspiracy theory that I believe. wow. A conspiracy theory I believe.

Auren Hoffman (56:43.646) You don't see much of a conspiracy theory guy.

Scott (56:46.01) I don't start out that way. I'm not sort of looking around corners in that way. A conspiracy theory that I believe.

Wow. Maybe if you have another question, something will pop in my head.

Auren Hoffman (57:01.788) Okay. Yeah. Yeah. That's good. I mean, it's interesting that you don't have one that comes to, I probably have like 50 in my head. Yeah. yeah. Yeah. Cause I'm, I'm, love it. I like, I like, I have all these crazy conspiracy theories about art and, you know, wine and lots of random things that are out there. Yeah. Private equity, you know, venture capital. I got them all.

Scott (57:06.816) You have 50? Okay.

Scott (57:15.405) Hahaha!

Auren Hoffman (57:24.554) All right. Last question, we're ask all of our guests, which is also new since you were on, which is like, what's a convention? What's, what is the conventional wisdom or advice? you think is generally bad advice?

Scott (57:34.502) Yeah, I, you know, I, I want to say this carefully. I want to say this carefully, but I think that there's a lot of advice which is given, especially to younger people, which is follow your passion. And like, if you're not passionate about it, don't give it any thought. And I, I understand where that comes from. And if you're giftedness,

naturally leads you in the direction of, you know, fill in the blank, whatever it might be. That's probably a pretty good indicator that you might want to be interested in that. I've long thought that the three things that correlate with somebody being really happy in their work is they're good at it, they find it interesting, and they can attach some higher level of importance to it. Like it serves the world. I feel good about the fact that what I do, you know, shows up in the world.

Auren Hoffman (58:27.38) Yep.

Scott (58:33.039) And so if passion means like I naturally go in this way anyway, then you're probably gonna hit at least the first of those three, which is I'm good at it, just because like that's, but I think that the issue that I have with that is, okay, now you've taken a job with whoever, and you're in your 18th month or something and somehow it's just kind of not feeling completely right. Of course you should keep your eyes open.

Of course you should look around. But the problem is, I think the follow your passion thing can also make a person a little bit inert. It's like, haven't found it yet. So like, maybe I shouldn't do anything or I'm in a place that it doesn't feel like the greatest fit. Therefore I'm gonna kind of mail it in. That doesn't serve you at all. No, do excellent work wherever you are.

Auren Hoffman (59:23.754) Yeah. Though there is something about like, I mean, to do excellent work, it's hard to do it unless you have at least some passion for the job and the work and the company and the people around you, or, at least some sort of combination of those. If, if, if all those things don't really line up and you're only doing it for the paycheck, it's hard to do excellent work. Or do you disagree?

Scott (59:39.645) Mm-hmm.

Scott (59:49.1) No, mean, you you need to have a real, I don't disagree in that you need to have all your energy available in order to be able to do excellent work. I just, I just think that, I'm, I'm looking for balance. I'm just, I'm just thinking that there needs to be, because that, that advice tends to, I've heard it at so many college commencements, for example. And I, I just think unqualified, doesn't actually provide enough guidance.

Auren Hoffman (01:00:03.667) Yeah.

Auren Hoffman (01:00:09.002) Yeah. Totally. Yeah.

Auren Hoffman (01:00:16.682) Well, also it's like, it's almost scenario where it's like, Oh, you probably have one passion and you should follow that particular passion. In some ways, like it's almost should be opposite, like work at something and then hopefully you'll develop a passion for that thing. You may, it may, it may be, you may not know, like let's put on, no, like I can't imagine must be like, I'm passionate about accounting or something when they're 18. Right. But maybe later you actually do develop a passion for that and you do develop a passion for that. Like, and then that.

That's great. and probably within us, there's many, many, many things we could develop. There's not like just one thing that we could develop a passion for.

Scott (01:00:51.258) Well, no, that's, to me, that's the yes. And I think that's the important. If you think about it, if the topic is steward your own career, then one of the things that is true is we have a terrible information problem because of all the things that a person could probably do at any given moment, we know a small fraction of them, right? I mean, you just don't know everything that you could potentially.

Auren Hoffman (01:01:03.22) Yeah.

Scott (01:01:20.375) go do if you're trying to make a rational decision right now, you haven't seen everything. So something that it seems to me is constructive is be excellent where you are, move forward, keep your head up, keep looking around, be open to moving towards something that maybe is a better expression of what you're good at, you find interesting, et cetera. So it's not like you have to remain rooted wherever you are, but

But we have a huge information problem. How do you know what you could do? You don't know everything that's out there.

Auren Hoffman (01:01:53.812) Well, I do think there is something about just like, what do you do when no one's looking? Like, what do you do when you're free time or something like that? Like when I even think of my, my kids, like I want my son, like whenever, whenever he has downtime, he's in a big book. He's just reading the book. He's not playing basketball. He's not like, so, you know, like, he's not like, you're not doing his instruments or he'll, he'll do anything possible to not like do like the practice for his instruments or whatever. He'll like,

He's not like, there's so many things he could be doing, that's so you, so that's probably an area where he's probably more likely to be passionate. Whereas like other kids, like when they have free time, they're like shooting basketball hoops or they're, you know, they're doing, you know, they've got something else or they're building Legos or whatever it is that they're doing. You start to see what they start to do. and then you have a sense, okay, well like it may be more likely they're passionate somewhere in that route, somewhere in that, you know, in that world.

Scott (01:02:32.301) Right.

Scott (01:02:48.322) Yeah. Yeah.

Auren Hoffman (01:02:50.026) All right. This has been amazing. Thank you, Scott Stephenson for joining us at World of DaaS. I follow you on LinkedIn. I know you're not really on X and stuff yet, but we'll get you there eventually. And I encourage our listeners to engage you there. This has been a ton of fun, great second time, guest on World of DaaS. Absolutely.